CVR Energy plunges 8% on Q4 loss after renewable diesel pivot
Strategic reversion to hydrocarbon processing accelerates depreciation as company exits struggling renewables business
CVR Energy shares fell 8% on Monday after the company reported a preliminary fourth-quarter net loss of $105 million to $120 million, driven by accelerated depreciation costs from reverting its renewable diesel unit back to conventional refining operations at its Wynnewood, Oklahoma facility.
The preliminary results represent a stark reversal from the company's prior strategy, which saw CVI invest heavily in renewable diesel production beginning in April 2022. The Wynnewood unit, originally converted to produce approximately 80 to 100 million gallons of renewable diesel annually, was returned to hydrocarbon processing in December 2025 following what the company characterized as unfavorable market conditions in the renewables sector.
"The reversion of the renewable diesel unit was completed in December, and we are optimistic about the benefits we are already seeing by having the hydrocracker at Wynnewood returned to hydrocarbon processing," said Mark Pytosh, Chief Executive Officer of CVR Energy, in a statement accompanying the earnings announcement.
The strategic retreat from renewable diesel production reflects broader challenges facing the sector. CVI's decision was prompted by multiple factors including a decline in the heating oil-bean oil spread, rising soybean prices, and reduced biofuel blending obligations after the U.S. Environmental Protection Agency granted small-refinery exemptions, according to industry reports. The company reported losses in its renewables segment during the third quarter of 2025, contrasting with profits from the same period in the prior year.
Beyond the renewable diesel write-down, CVR faced operational headwinds in its nitrogen fertilizer business. Reduced production and sales volumes at the Coffeyville fertilizer facility resulted from a planned turnaround combined with a delayed post-turnaround startup, further pressuring quarterly results. The company reported ammonia utilization rates of just 60% to 65% for the quarter.
Despite the fourth-quarter setback, CVR Energy expects full-year 2025 net income to reach $17 million to $32 million, though this represents a dramatic compression compared to typical refining profitability. Fourth-quarter adjusted EBITDA is estimated at $78 million to $102 million, with total refining throughput reaching 210,000 to 220,000 barrels per day.
Looking ahead to 2026, management signaled improved operational prospects. "We also look forward to a year with no planned turnarounds in our Petroleum segment in 2026," Mr. Pytosh stated. The company announced preliminary capital spending estimates of $200 million to $240 million on a consolidated basis for the coming year.
The stock closed at $22.58 on Monday, extending what has been a challenging period for investors. Shares began January at approximately $25.19 and touched a low of $22.10 on January 12. The 52-week trading range spans from $13.50 to $41.67, reflecting extreme volatility in the refining and renewable energy sectors.
Analyst sentiment toward CVR Energy remains firmly negative. According to recent consensus data, the company carries a "Strong Sell" rating from analysts, with average 12-month price targets ranging from $26.33 to $29.25. The stock currently trades below the majority of analyst price targets despite Monday's decline.
CVR Energy retains flexibility in its strategic positioning. The renewable feedstock pretreater project at Wynnewood, mechanically completed in late 2023, has been placed in standby mode but can be reactivated quickly should market conditions and government incentives improve, the company has indicated.
The company ended the quarter with cash and cash equivalents of $500 million to $520 million, with total long-term debt and finance lease obligations ranging from $1.7 billion to $1.8 billion. This liquidity position provides operational flexibility as CVI executes its renewed focus on traditional petroleum refining and nitrogen fertilizer production.